Skip to main content
Celebrating 50 years of Building High Performance Corporate Teams - 1971 to 2021

“Fail Fast” is a (relatively) new trend currently in vogue in business. Wikipedia defines it as “a property of a system or module with respect to its response to failures. A fail-fast system is designed to immediately report at its interface any failure or condition that is likely to lead to failure. Fail-fast systems are usually designed to stop normal operation rather than attempt to continue a possibly flawed process.”

For new product development such as patented drugs, companies try to set up early “gates”, to allow them to kill potentially unsuccessful products early on in the process, rather than spending millions of dollars and months or years to take a concept to market.

The same process can be used in hiring new employees. The old adage that companies hire too quickly and fire too slowly is probably true. In “Topgrading” (2005), Dr. Brad Smart documents that bad hires have an average ROI of almost -500%. Clearly, it is critical to establish meaningful metrics for all new hires, setting out clear expectations for progress throughout the entire probation period, so that employment can be terminated early on with no risk of litigation if the individual is clearly “not going to make it”.

In a sales role, for instance, it is not necessary to wait until the end of the first year to see if the individual has met his or her sales targets, if the sales manager has observed and documented early on that the sales rep has not mastered the product knowledge, or achieved appropriate activity targets such as cold calls, presentations, or RFP submissions.

To make this work, the following must occur:

  • A variety of measurable and meaningful key performance indicators (KPI’s) must be established by management, covering expectations throughout the various stages of on-boarding for new employees.
  • Management must agree that failure to meet the various KPI’s throughout the on-boarding process is grounds for termination.
  • New employees must be made aware of the KPI’s, and the consequences of their failure to achieve them, at the start of their employment.
  • Throughout the on-boarding and probation process, management must meet regularly with new employees to make them aware of their progress towards achieving the KPI’s, and to provide opportunities for improvement.

While we all hope that every new employee is going to make it, we also know that unfortunately this is not the case. A little advance planning can go a long way to reducing the cost of poor hires.